DGAP Vs IREO Victory Valley Pvt. Ltd (GSTAT)
The Goods and Services Tax Appellate Tribunal (GSTAT) accepted the final report submitted by the Director General of Anti-Profiteering (DGAP), concluding that IREO Victory Valley Pvt. Ltd. had not violated the anti-profiteering provisions under Section 171 of the Central Goods and Services Tax (CGST) Act, 2017. The ruling stemmed from an extended investigation into the real estate company’s project, which began following a recommendation from the erstwhile National Anti-Profiteering Authority (NAA) in a separate case involving M/s Ireo Grace Residency Pvt. Ltd.
Background of the Investigation
The initial investigation was directed to ascertain whether the benefit of Additional Input Tax Credit (ITC), accrued due to the transition to the GST regime, had been passed on to homebuyers as required by Section 171 of the CGST Act, 2017. This section mandates that any reduction in the tax rate or any benefit from ITC must be passed on to the recipient (the consumer) by way of a commensurate reduction in price.
The investigation period spanned from July 31, 2017, to December 31, 2020. The Respondent, IREO Victory Valley Pvt. Ltd., admitted that the benefit of Additional ITC had accrued in only two of its projects, “Gurgaon Hills” and “Grand Hyatt Residency,” managed by different legal firms. However, for the specific projects under scrutiny, “Victory Valley” and “Ireo Waterfront,” the company asserted that no such benefit of Additional ITC was claimed, particularly since occupation certificates for some phases were received in the post-GST period.
